Should The Minimum Wage Be Raised? Entrepreneurs Weigh In

Two completely unrelated pieces of news hit me this morning and made me wonder about how we treat employees.

The first was the report of another horrific industrial accident in Bangladesh -- nearly 200 people left dead in the collapse of an eight-story building where a number of garment factories operate. This on the heels of the Tazreen Fashions plant fire that killed 112. Well, you might silently (and cynically) say, this is the third world. Bangladesh, India, China -- they don't seem to value human life the way the West does. We take much better care of our workers ... don't we?

The second piece of news was a poll by the Small Business Majority that landed in my inbox, claiming that better than two-thirds of the 500 entrepreneurs surveyed from across the country support a bump in the $7.25/hour minimum wage and believe in annual cost-of-living adjustments. More surprising yet: Most respondents identified themselves as leaning Republican (46%); 35% skewed Democratic, and 11% Independent. Nearly 9 in 10 of those answering the survey say they already pay their employees more than the minimum wage -- across virtually all types of businesses.

Why? Two main reasons, according to the survey. One, a conviction that paying workers more helps the economy by increasing disposable income and driving demand for more goods and services offered by small businesses. Two, that higher wages help ease demand for taxpayer-supported entitlement programs. Purporting to be a "scientific" opinion poll -- a better statistician than I could determine whether that's so -- the SBM survey suggests that it's not relying on squishy moral suasion, but cool economic argument.

Such reasoning doesn't sit well with my friends over at the National Federation of Independent Business, a group that represents 350,000 entrepreneurs, and is opposed to raising the minimum wage. "We're hearing from our members that they want more flexibility to structure the workforce as they need to," says Holly Wade, NFIB'S senior policy analyst. Lifting wages "also limits the options for entry-level positions --and for those people still looking for a job."

Hill wondered, as I did, whether the SBM poll gathered responses from sole proprietors (who have no stake in what the minimum wage is) or multi-employee owners. So I asked. Turns out 23% of the survey sample comes from one-(wo)man shops; the rest are entrepreneurs who employ workers."I should add that 61% of retail and restaurant owners support an increase," says John Arensmeyer, Small Business Majority's founder and CEO. "They're the most likely group to pay minimum wage."

So who's right? I'd like to hear from you. Considering what's driving the renewed interest in immigration reform -- attracting and keeping talent, a challenge confronting all entrepreneurs -- the minimum wage wrangle is likely to get louder and louder.